U.S. Credit Card and Debt Study 2018

Nearly half of consumers say they’ve never received education on credit cards. The average consumer with credit card debt is carrying more than $6,000 of it. And about one-third of millennials are being held back from buying homes because of credit card debt.

On the bright side, though, consumers are far more likely to get a new card to improve their credit scores (42% of consumers) than to acquire more debt after maxing out their other cards (8%). Also, 62% of consumers have more savings than credit card debt.

When are people educated about credit cards (or not)?

Nearly half of the 2,500 respondents answered they’ve never gotten a proper education on credit cards, an alarming data point given the prevalence and importance of credit in consumers’ lives.

Of those who did receive a credit education, the most likely times were during high school and college:

When were you educated on credit cards?

Middle School - 8%

High School - 22%

College - 18%

While in the bank applying for a credit card - 7%

Never got a proper education on credit cards - 45%

U.S. credit card debt landscape

The good news: Nearly one-fourth (23%) of consumers carry no credit card debt. Among those who do, however, the average debt load is $6,245.63. Relatively few consumers (6%), however, have mega-debt over $20,000 on their cards.

How much credit card debt do you have, if any?

Under $1000 - 26%

$1001 - $5000 - 23%

$5001 - $10,000 - 12%

$10,001 - $15,000 - 6%

$15,001 - $20,000 - 5%

Over $20,000 - 6%

I don’t have any credit card debt - 23%

Men tend to carry a slightly heavier debt load on their cards than women do. The average credit card debt amount for men is $6,417.11, while the average for women is $6,148.55.

Fortunately, consumers have more savings than card debt. Under 40% have more debt than savings, while the majority (over 60%), have more savings than debt.

What do you have more of?

Credit card debt - 38%

Savings - 62%

Men tend to have a slightly more favorable ratio of savings to card debt, our survey found:

Women: 57% have more savings; 43% have more credit card debt.

Men: 67% have more savings; 33% have more credit card debt.

For those who have difficulties paying off their card balances, housing/living costs are the major culprit, with impulsive spending a somewhat distant second:

What are the main reasons you struggle with paying your credit cards?

Housing/cost of living - 31%

Impulsive spending - 20%

Student loans - 17%

Laid off/loss of income - 14%

Medical costs - 13%

None - 10%

Cost of living remains the biggest challenge regardless of gender, but men (22%) are slightly more likely to say impulsive spending hinders their ability to pay their card balances than women (20%).

Plans delayed because of debt

Credit card debt racks up interest costs. So it’s no surprise some consumers are prioritizing tackling it over making other purchases.

Consumers are most likely to be delaying travel and vacations because of their card debt. But other, more major, financial plans are being placed on the back burner as well:

Which life decisions/plans are you delaying due to your card debt?

Taking a vacation/travel - 30%

Buying a home - 21%

Buying a new car - 18%

Going to school - 11%

Getting married/starting a family - 9%

None - 19%

For millennials, it’s homeownership that’s the most-delayed goal. Due to card debt, 30% of respondents in the 24-to-34 age bracket say they’re blocked from buying a home. Having too much debt can weigh down your credit score and dash your chances of mortgage approval. In addition, getting the best rates on a mortgage requires putting down a significant down payment, something that’s hard to save for when combatting card debt.

Rising costs of living across major cities (where millennials may seek their first post-college jobs) don’t help either, when it comes to saving up for that 20% down payment. According to January 2018 Trulia data, the median rent in San Francisco is $4,000 per month (a 30% increase since 2012). In New York City, the median rent is $2,300 (up 15% since 2012).

How do consumers choose and use their cards and rewards?

The majority of consumers (55%) say they’d get a new card for cash back, travel or store rewards. Credit building (42%) is the next-biggest reason for getting a new card.

Desperation (need for more credit after maxing out existing lines) is, thankfully, a comparatively rare reason to get a new card:

What are the main reasons you would get a credit card?

To improve your credit history/score - 42%

To earn cash back - 23%

To earn travel rewards - 20%

To earn store rewards - 12%

Previous card maxed out - 8%

To earn a signup bonus - 7%

Other - 9%

When it comes to rewards, consumers tend to gravitate toward generic one-size-fits-all rewards cards, rather than travel-specific cards:

Do you have an additional credit card specifically for travel or do you have a one-size-fits all card?

A one-size-fits-all card - 60%

Multiple travel cards w/ different rewards - 20%

A specific travel card - 20%

Rewards preferences don’t vary much by age, despite the narrative that younger consumers gravitate toward travel. Nearly all age groups surveyed (18 to 24; 25 to 34; 35 to 44 and 45 to 54) have roughly the same 60/40 breakdown shown above when it comes to their preferences (one-size-fits-all card vs. travel cards). The exception are those above age 65 -- 34% of them have have travel cards, and 66% have one-size-fits-all reward cards.

Our survey also found that relatively few cardholders have funded a trip with points:

Have you ever purchased a trip with points?

Yes - 23%

No - 77%

The age group most likely to have used points for travel are those in the 45-to-54 age bracket. Roughly 26% of them have redeemed points to pay for a trip.

ID theft tops the list of credit card concerns

Security concerns outweigh concerns about overspending when it comes to consumers’ top worries about credit cards.

What's your main fear when using a credit card?

Security concerns (skimming, identity theft) - 26%

Accruing too much interest and eventual debt - 22%

Relying too much on credit - 18%

Missing a payment - 13%

Worry it may increase my spending - 12%

Losing my credit card - 9%

With major data breaches consistently making the news, it’s probably not a surprise that consumers worry more about thieves than about their own impulse control. Identity theft is also very real to the many consumers whose cards have been compromised -- almost one-third of those we surveyed have personally dealt with card fraud.

Have you ever been affected by credit card fraud or hackers receiving your information?

Yes - 31%

No - 69%

Methodology

Our data was gathered via a 10-question Google Survey of 2,500 U.S. consumers age 18 and older, conducted between April 11 and April 13, 2018. Google Surveys makes use of the inferred demographic and location information to employ stratified sampling by distributing the surveys based on the targeted audience to its publisher network and/or smartphone (Android and iOS) users. Google Surveys uses post-stratification weighting to compensate for sample deficiencies to remove bias among the survey sample.

The margin of error for our results ranges between ± 0.2 and ± 1.9 percentage points, depending on the question.

The confidence level for most of the results is 95%. Google Surveys determines 95% confidence in the winning answer by running up to 10,000 simulations that sample from the Gamma distribution. It stops the simulations when one answer has won 95% of the time for at least 250 simulations. If there is no winning answer after 10,000 simulations, Google surveys declares confidence too close to call.

ABOUT THE AUTHOR

Kristin is a credit-industry and cards expert at Offers.com who knows the ins and outs of credit reporting and rewards programs. She got into points and miles thanks to her love for travel and into credit building because of her dream of homeownership – and therefore believes cards are a powerful tool for both rewards-maximizing and credit-building. Learn more about Kristin McGrath

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Any opinions, analyses, reviews or recommendations expressed in this article are those of the author's alone, and have not been reviewed, approved or otherwise endorsed by any card issuer.

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Credit Cards Explained may earn affiliate commissions from our partners on this page. These commissions do not affect how we select, rate, or review products. To find out more, read our complete terms of use.